U.S. Grand Jury Decides Not to Indict Donovan

WASHINGTON — A federal grand jury in New York has declined to indict former Labor Secretary Raymond J. Donovan on allegations of lying in an earlier investigation into suspected kickback agreements and payoffs when Donovan was a construction company executive, it was announced today.

A special appeals court panel revealed that independent counsel Leon Silverman, who directed an earlier inquiry into Donovan’s activities, was reappointed in June, 1985, to probe Donovan’s testimony in which he denied knowledge of kickback agreements and an alleged $15,000 payment to him by a former supplier of Schiavone Construction Co.

Acquitted in May

Donovan was acquitted last May 25 on larceny and fraud charges in connection with a New York subway construction project.

Silverman’s report today said that “the independent counsel has concluded that while there was some evidence to support” an indictment of Donovan for perjury, false statement or obstruction of justice” arising from his testimony on May 11, 1982, “it was unlikely that a conviction . . . could have been obtained.”